ITIF Releases “2012 State New Economy Index”

10 Dec, 2012

According to Robert D. Atkinson and Luke A. Stewart, more than three years on from the end of the Great Recession, only six states have regained employment levels enjoyed prior to the recession, and 17 states are still more than 5 percent below their pre-recession employment levels.

In the 2012 State New Economy Index, the authors explore why challenges to employment still exist. The report is published by the Information Technology and Innovation Foundation. While arguments range from lack of consumer spending to the need for more federal government stimulus, there is one idea that goes largely unnoticed, according to the index. The “invisible force” is the decline in the competitiveness of the U.S. economy in the global marketplace.

The failure to adapt has caused traded sector companies, and manufacturers in particular, to look to more competitive countries when selecting business destinations. The authors say that for the United States to be more competitive, we must focus on competing on the basis of innovation and entrepreneurship and less on cost. The country’s competitive advantage will continue to be found in making things and providing traded services that other nations are unable to make or provide as easily or efficiently.

The index reviews 26 indicators, divided into five areas, to best capture the New Economy:

*Knowledge jobs

*Globalization

*Economic dynamism

*The digital economy

*Innovation capacity

Click here for complete details and to find out how the states ranked.